If you want, you could get just the pairing button and forgo the entire cradle. A number of folks take this approach for cosmetics. There is an E46 part that is just the pairing button with no cradle.
I actually had a -268 ULF, and that is definitely a well known 7th generation part.
The ULF downloads the phone book through standard BT protocols. The first thing I would recommend is just try the XDA Trion, it may work fine as it is. If it does not work, try installing
www.jetwaremobile.com on your XDA. JetWare is a pretty well known BT utility for Windows-based phones that works great with BMW BT.
The ULF recognizes each phone as a unique device based on its physical hardware address. So, if you did the phone swap thing, it would lose the address book when you went back to the XDA. Plus, you are pairing with the phone, not the SIM car, so you would have to individually pair each phone with the ULF, and the ULF would then maintain the phone books for each phone independently.
You can add numbers to the ULF via the voice dialing tags. The numbers do not show up on the nav screen or MID, but it works find. That is actually the way that most other BT systems work.
The ULF can pair with either three or five phones (I can't remember). It can only use one at a time, and I believe that the priority is last paired, first used.
The ULF probably could be updated with new firmware, but BMW has not chosen that path. I suspect it would cost more to implement than it is worth. Many other parts, like the ECU, video module, transmission computer, etc., can be reprogrammed with new firmware, but many of those are not maintained that way by BMW.